Small Group Compliance

Read More here: IRS Releases 2024 Benefit Plan Limits

Although these annual notices may be provided at different times throughout the year, employers often choose to include them in the new hire packet, at open enrollment for administrative convenience, or annually in January to your company intranet. Please see the following link to review and download copies of the notices.

Read More here: Brinson Compliance Annual Notices

• The PCORI fee has been extended to 2029.  Annual fees will be announced.
• Funds are used for research related to best treatments from a quality perspective
• Self-funded plans (including HRAs) will submit payment to IRS using Form 720
• The fee is due by July 31 of the year following the calendar year in which the plan/policy year ended. 

Read More about who pays, how to calculate the fee and more here: Frequently Asked Questions About The Patient-Centered Outcomes Research Institute (PCORI) Fee

• Applies to employers with 50 or more full-time and full-time equivalent employees (FTE). 
  • Full-time employee defined as working 30 hours or more per week.
  • Use the HealthCare.gov Full-time Equivalent Employee Calculator to determine your FTE count. 
• Pay:
  • Cancel coverage  = # of employees, less 1st 30 x $2,750 (2022*) = penalty
  • Penalty is not tax deductible
• Play:
  • Offer at least one plan option to at least 95% of all full-time and/or full time equivalent employees and their dependents to age 26 that is affordable and provides minimum value. Spouses can be excluded from coverage.
  • If a plan is offered but is not affordable or does not provide minimum value, an annual penalty of $4,120 (2022*), $343.33 per month, for each employee who purchases coverage through the state exchange and receives a subsidy.
  • Do you track variable hour employees to determine if and when an offer of coverage should be made?
  • How do you define your  look-back measurement / administrative / stability period?
  • Affordable = cost to employee does not exceed 8.39% of household income for self-only coverage in 2023.
  • Minimum value = provides “bronze” level of benefits (60% coverage)

• Who must report?  
  • All self-funded employers (includes level funded plans) must report regardless of the number of employees employed.
  • Fully insured employers who employed 50 or more full-time equivalent employees (FTE) during at least half of the previous calendar year must report. NOTE: other requirements may also apply. 

Read More here: Affordable Care Act (ACA) Reporting Services

Texas Senate Bill 51, passed in the 2005 Texas legislative session (Texas Insurance Code 843.210 and 1301.0061), established requirements regarding group premium payment responsibilities after employee termination. *

The requirements of this law and regulation apply to all Texas sitused fully insured group plans, including all individuals, employees and dependents covered under these plans as summarized below.

Premium Payment and Coverage After Enrollee’s/Insured’s Termination

• Group policyholders are liable for an enrollee’s or individual insured’s premium payments from the time the employee ceases to be eligible for coverage until the end of the month in which the medical carrier is notified by the group policyholder that the employee is no longer part of the group eligible for coverage; and
• Group policyholders are required to provide coverage for the enrollee or individual insured under the policy until the end of the month in which notification is received by the medical carrier.

Example: When an employee terms on March 20, 2015, and the employer notifies their medical carrier on April 6, 2015, the employer is responsible for paying premium, and the enrollee is covered, for the entire contract month of April 2015.

Texas Department of Insurance (TDI) regulations provide further clarification regarding certain loss of eligibility situations. The policies addressing these situations are as follows:

Termination Notification for Loss of Eligibility near end of Month

Group Policyholder/Agent

If an enrollee ceases to be part of the group eligible for coverage within the seven calendar days preceding the end of the month and the group policyholder or the group’s producer/agent notifies their medical carrier about the termination within the first three business days of the subsequent month, coverage will be cancelled at the end of the month during which the employee was terminated (e.g. an employee terminates employment on March 28, 2015, and group policyholder notifies their medical carrier on April 1, 2015, coverage will be cancelled effective April 1, 2015).

Terminations Due to Death

Terminations due to death can be processed retroactively for employee-only coverage. If the policyholder carries dependents on his/her policy, coverage will be cancelled at the end of the month during which notification is received (e.g. if an employee dies on Sept. 27, 2015, and the medical carrier receives notification Oct. 1, 2015, coverage will be cancelled effective Oct. 1, 2015, if no dependents are covered. If dependents are covered, cancellation will be processed for Nov. 1, 2015).

Successor Coverage Documentation Required

The medical carrier will require documentation of successor and/or Medicare coverage when processing cancellations due to elective terminations related to coverage obtained through successor and/or Medicare policies.

Submission Methods

Notification to cancel coverage must be submitted directly to the medical carrier in writing through any of the following methods:

• Medical Carriers Online Portal – The receipt date is the cancellation transaction date.
• Written Correspondence Received via U. S. Mail – The receipt date is the date correspondence is received in the medical carrier’s processing office.
• E-mail – The receipt date is the transmission date of the group policyholder’s email.
• Automated Eligibility Processing (AEP) – The receipt date is the date the AEP transmission is received by the medical carrier. Important: All outstanding no-match/discrepancy inquiries and/or necessary file corrections must be made by the date of the next file transmission. Otherwise, any cancellation requests in question will be processed on the next service date following receipt of the corrected information.
• Fax – The receipt date is the group policyholder’s fax transmission verification date.
• Hand Delivery – The receipt date is the date the medical carrier personnel sign the delivery receipt.

*These requirements were further addressed in TDI rules found at 28 Texas Administrative Code Section 21.4001 – 21.4003.

Many level-funded plan sponsors can complete a survey from their medical carrier, which then allows the carrier to file the RxDC report on their behalf. These surveys are typically issued during the first quarter of the year, with deadlines that vary by carrier. If the survey is not completed or the deadline is missed, the plan sponsor will need to submit the report directly to CMS by June 1.